What is the likeliness that the trustee will abandon the house and we can keep it in a Chapter 7?

Tax records generally value a house on the assumption that it's in good condition. The actual value of the house would be reduced by any repairs which are necessary to restore the house to good condition. So if the place needs a roof, paint and a new furnace, get quotes on the roof, painting and furnace replacement.. This will give you evidence to argue that the house is worth less than $157,600. Now look at it from the trustee's point of view: the trustee doesn't want your house; she wants money. So it's a $157,600 house, that requires (say) $10,000 in repairs and has a $132,000 loan - that only gives her $157,600 minus $142,000 minus your $11,000 exemption or $4,600. She's not a real estate company, to sell the house she's got to pay a realtor (or auction company) say 7% of the sales price - that's over $10,000. So she'd get nothing. The reality is that trustees take over two types of house: 1. Houses with no mortgage and no exemption - since the whole price goes to the trustee, she's willing to go through the hassle of selling a $25,000 house, if it's free and clear. 2. Houses that have large percentage of equity - so a $100,000 with a $30,000 loan and a $20,000 exemption means 50% of the house is equity - she'll take it. But with the same $50,000 of equity - a $1,000,000 house with a $930,000 loan and $20,000 of exempt, isn't going to be worth her while - the realtor commission is much more on the more expensive house and often people will only buy a bankruptcy house if there is a discount. A 5% discount on a $100,000 house is only $5,000 and the trustee still gets $45,000. But a 5% discount on a $1 million dollar house wipes out her entire gain. Now if there's a $1 million house with $500,000 of equity, don't try to talk to trustee for a while - she'll be having orgasms.

Then you don't live in Nevada, because the homestead exemption here is $550,000.

In Colorado you would be fine. You are entitled to a $60,000 homestead exemption. That amount increases to $90,000 if either one of you are 60 or older, or either one of you are handicapped, or anyone of your children are handicapped. I hope this helps. Good luck!

Idaho has $100,000 in exemptions for the home, so you would be safe here. I cannot speak for other jurisdictions.

When evaluating the probability that an asset will be liquidated in a Chapter 7, a full review of a debtor's assets is necessary. This is especially true when looking at a debtor's home. Under the federal exemptions, a debtor may exempt equity in a home in the amount of $22,975 by using the 11 USC 522(d)(1) "homestead exemption." When it is a joint case (husband and wife filing together), the homestead exemption may be used by both debtors, which would allow for an exemption of $45,950.00. A debtor's ability to use the homestead exemption is reduced when other assets require exemption under the 11 USC 522(d)(5) "wild card" exemption. If the wild card exemption is needed to protect assets of a debtor and the equity in those assets exceed $1,225.00, the debtor will need to borrow from the homestead exemption (up to $11,500.00 can be borrowed by each debtor). The wild card exemption is typically used for bank account funds, anticipated tax refunds, stocks or investments outside of an qualified retirement plan, or for assets that have value that exceeds its applicable statutory exemption. A debtor is not required to use the federal exemptions. A debtor may elect to use the Michigan exemptions, which provide for a more generous homestead exemption. However, most debtors do not elect to use the Michigan exemptions because there is no equivalent to the federal wild card exemption. A consultation with an experienced bankruptcy attorney would be able to give you a better sense of what it means to elect state exemptions and if it is right for you. The Trustee when determining whether he/she will administer or attempt to liquidate an asset will first try to determine what equity exists (market value less any liens). Once the equity is determined or estimated, the Trustee would then look at the exemptions taken and see to what extent any of the equity is unprotected. A Trustee will not liquidate a home unless he/she thinks they can sell it for enough to pay off all the valid liens, pay off the debtor for any valid exemptions, pay all necessary costs associated with a sale, and also have some type of profit after the aforementioned are satisfied. A note of caution: when filing a Chapter 7, the Trustee will be examining the recorded deed and recorded mortgage(s) to see if there are any defects that would allow them to avoid the lien. Avoiding the lien is a fast way to create a large amount of equity and cause a debtor to lose their home. This is one, among many, reasons that it is so important to hire an experienced and thorough bankruptcy attorney. Sitting down with an experienced bankruptcy attorney to discuss your assets in detail should provide you with a better sense of whether liquidation is likely for you. An attorney will also be able to discuss your alternatives for resolving your debt while avoiding loss of assets, such as Chapter 13 and debt settlement.

The homestead exemption is usually based on the amount of equity you have in your home. Your stated facts suggest that you have close to $25,000 in equity. County tax records are a credible source of value but you can also ask a realtor for a comparative market analysis (CMA) if there are reasons you believe the value is different from the tax records. Some states, such as Oregon, give debtors a choice of state or federal exemptions, and this amount of equity would be exempt under Oregon or federal laws, providing that you can use those exemptions by virtue of satisfying the residency requirements. Regardless, only a lawyer fully informed of your situation can advise you on the appropriate exemptions to use. That is the essence of the practice of law.

If you live in Wisconsin, and are married, you may exempt up to $150,000.00 of your equity in the home. So you should have nothing to be concerned about. Even if you chose the federal, rather than the Wisconsin, exemptions, you could ordinarily exempt something more than $44,000 in equity. I have no idea how the number of dependents you have relates to the size of your homestead exemption: it doesn't. I do strongly suggest you retain a skilled bankruptcy lawyer to assist you through this process. It's almost always worth the expense. Good Luck.

You have calculated your exemptions wrong. You and your spouse each would have $35,000 equity in your principal residence. You should really consult with a qualified bankruptcy attorney before proceeding. This is not an area of the law that you can pick up online or with a forms book from Office Depot.